Intel Stock Rises 2% After Musk Suggests Tesla Might Source Chips

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TLDR

Intel stock rose nearly 2% in premarket trading following comments from Elon Musk.
Musk hinted at a potential partnership between Tesla and Intel for sourcing chips.
The Tesla CEO discussed his plans for advancing AI chip development with a possible collaboration.
Despite positive momentum, retail investors on Stocktwits maintained a bearish view of Intel stock.
Tigress Financial raised its price target for Intel stock to $52, maintaining a ‘Buy’ rating.

Intel stock increased by nearly 2% in premarket trading on Friday. The rise followed comments from Tesla CEO Elon Musk about the potential of sourcing chips from Intel. Musk discussed his plans for Tesla’s AI chips, including a possible collaboration with Intel.

Musk Hints at Possible Partnership with Intel

At Tesla’s annual shareholder meeting, Musk revealed plans to transition to a new AI chip, the AI6. The company aims to double its performance with this new iteration. While Tesla works with TSMC and Samsung, Musk expressed openness to Intel as a potential partner.

“We may work with Intel,” Musk said, acknowledging the company’s role in the chip industry. He highlighted the difficulty of meeting Tesla’s chip needs solely through existing suppliers. The comments spurred optimism for Intel stock as investors speculated about the possible collaboration.

Retail Investors Maintain Bearish Sentiment on Intel Stock

Despite the positive premarket movement, retail investors on Stocktwits maintained a bearish outlook on Intel stock. The sentiment may stem from concerns about valuation, given Intel’s recent gains. The stock has risen significantly this year, which has led some investors to question its future growth prospects.

However, Tigress Financial raised its price target for Intel stock from $45 to $52. The firm remains confident that Intel can benefit from growing demand for AI-enabled PCs and data center solutions. Intel’s partnerships with Nvidia and Microsoft have been highlighted as key strengths in its AI strategy.

Intel stock has surged around 88% year-to-date, outperforming both the tech sector and broader market indices. While some investors express caution, analysts remain bullish about Intel’s position in the evolving AI market.